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News
NZ winery convicted of illegal bulk wine production
A New Zealand fruit winery has been fined more than NZ$15,000 after it was convicted of illegally manufacturing and selling liquidated stock, and dodging taxes.
Sentry Hill Winery, of New Plymouth on New Zealand’s North Island, is a fruit winery, and does not produce wine from grapes.
It was placed into liquidation at the request of New Zealand Customs in April 2016 after it failed to pay a debt owed from unpaid excise duty totalling more than $280,000.
The sole director and shareholder Stephen Parkes’ powers as a director ceased upon liquidation, with the business and its assets taken under the liquidators’ control, including equipment and a stock of bottled wine.
Mr Parkes’ wife Wendy Parkes then incorporated another company, Sur Le Mur Ltd, and applied for a Customs-controlled area licence to manufacture alcoholic products at the Sentry Hill Winery.
Customs declined her application on the basis that the area was already licensed to Sentry Hill Winery which was in liquidation.
However an investigation by the customs team later revealed that Sur Le Mur Ltd had sold bulk red wine to retail outlets in New Plymouth, despite not having a licence to manufacture or sell the goods.
A stocktake at Sentry Hill in January 2017 also revealed details of unaccounted for bottled liquor, equating to more than $13,000 excise duty owed to Customs, which was never paid.
It transpired that Parkes had sold the liquor to his wife’s company Sur Le Mur Ltd, who then on-sold it to grocery and liquor outlets.
Last week, Sentry Hill was convicted in New Plymouth District Court of unlawfully manufacturing and selling wine and defrauding customs, and ordered to pay more than $13,500 in reparations and fined $2,000.
Sur Le Mur Ltd was also convicted and fined $1,500 for the same offences.
Customs manager for central and southern Ports, Joe Cannon, said this case served as a lesson to other New Zealand winemakers about the importance of obtaining a Customs-controlled area licence to manufacture and sell goods and paying excise duty.
“People may think that because they are a small business then they can break the rules, however, Customs takes these matters very seriously, and as seen in this case, we will prosecute when the law is broken.”